Liquidation(a) Clause Samples

Liquidation(a). (a) When any reason for liquidation of the Company as specified in the Laws and Regulations or as agreed upon by the Parties arises, the Company will carry out the liquidation in accordance with applicable Laws and Regulations of the PRC. (b) Upon its decision to liquidate the Company, the shareholders’ meeting shall formulate liquidation procedures and principles and establish a liquidation committee (the "Liquidation Committee") in accordance with Laws and Regulations of the PRC relating to the liquidation, which shall conduct the liquidation of the Company pursuant to the Company Law of the People’s Republic of China, the Articles of Association of the Company and other Laws and Regulations of the PRC relating to the liquidation. The Liquidation Committee shall conduct a thorough examination of the Company’s property, creditor’s rights and debts, work out the statement of assets and liabilities and a property list, put forward a basis on which the Company’s property is evaluated and calculated, formulate a liquidation plan for the Company and fulfill such other tasks as may be required by applicable Laws and Regulations. (c) The Liquidation Committee shall pay the liquidation expenses and discharge the Company’s liabilities out of the Company’s assets in accordance with the order of priority as specified in applicable Laws and Regulations. After the payment by the Company of the liquidation expenses, wages of employees, social insurance contributions and statutory compensations, outstanding taxes and discharge of the Company’s debts according to law, the balance of its assets shall be distributed in the following order: 1) the Investors shall be paid in priority to the other shareholders. The remaining assets of the Company shall be first distributed to the Investors until the Investors will have obtained in the aggregate: (1) Board approved dividend declared but not yet paid to the Investors, and (2) 100% of the total amount of the Investor Capital Increase Subscription Price plus the interest calculated at an annual (compound) rate of 10% (for the period from the date of Closing of the investment in the Company by the Investors to the date of receipt by the Investors of the liquidation proceeds, and for a period less than a year, the interest shall be calculated on a pro rata basis) (collectively the “Investors Priority Liquidation Payment”); if the liquidation proceeds are not sufficient to fully pay the Investors Priority Liquidation Payment, each o...